Equity Incentive System Effectiveness Anailsis

As an effective means to alleviate the principal-agent conflict,equity incentive is widely used in the world scope,provided the impetus for the company's long-term development.But in our country,equity incentive at the fledgling stage,that of equity incentive effect is very different from western countries,domestic listed company equity incentive effect is not significant,even negative effects often occur.This paper argues that the effectiveness of the equity incentive is closely related to equity properties and management power.Shanghai jahwa as domestic chemical industry leading enterprises,it carried out three sets of equity incentive plan since 2008,during this period,it has experienced from state-owned corporation restructuring process,and also through the process of the original management at all.Based on this,through the analysis of the company business performance,the market reaction,the enterprise value as well as the retention of the incentive object,it is concluded that Shanghai jahwa three sets of equity incentive plan is valid conclusions,and induces the factors influence on the effectiveness of equity incentive.Through the equity incentive plan of Shanghai jahwa carding and research,the analysis results show that:First,the management power influence the design of the equity incentive.When management power is large,incentive scheme have more welfare nature,the effect is bad;When the management power is limited,the incentive scheme more reasonable,the effect is better;But when the big shareholder power completely,reflect big shareholders will incentive scheme,design is not reasonable,cause the failure of incentive.Secend,the index design of exercise influence the effectiveness of the equity incentive.Excessive exercise conditions will affect the enthusiasm of incentive object,influence exercise effect.Third,the equity incentive effects of the company's dividend distribution policy.When the equity incentive have welfare nature,management through frequent transfer shares a disguised form of exercise to reduce costs,to obtain the biggest profits.This article expectations for listed companies according to their own environment and situation,selection and design effective equity incentive system to provide scientific guidance,in order to improve the equity incentive effect,at the same time also for the stakeholders of listed companies evaluate the rationality of the equity incentive system to provide the reference basis.